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Islamic Bank approves US$20m for Guyana power supply upgrade

GEORGETOWN, Guyana — Unreliable power supply woes in Guyana may soon be a thing of the past after the approval by the Islamic Development Bank (IsDB) of a loan of US$20 million for the Guyana Power and Light (GPL) utility upgrade programme for a comprehensive turnaround of the company, a press statement from Finance Minister Winston Jordan’s office said on Saturday.

This loan is the first sum to be disbursed from the resource envelope of US$900 million that was extended to Guyana by the IsDB in 2017.

Meanwhile, the opposition criticised the government for borrowing from the IsDB, an AAA rated institution. However, the opposition while in office marketed the Guyana’s resources cheaply and borrowed heavily from China.

Guyana has already benefited from two grants from the Islamic Bank totalling more than US$500,000.

The Guyana Power and Light has long faced many challenges in providing reliable supply of electricity to its customers. This has been compounded by a rapid increase in demand for energy by residential and commercial users. The GPL utility upgrade programme is co-financed by the Inter-American Development Bank and the European Union and, upon completion, will reduce losses, realise a more efficient and reliable service and deliver a better quality of electricity for households and commercial users.

The utility upgrade programme is part of GPL’s development and expansion for the period 2014 to 2021, which aims to reduce the overall losses in the power system the finance ministry said.

Jordan will lead a Guyanese delegation to Middle East next week and will sign the agreement with the IsDB on September 19, 2018, in Jeddah, Saudi Arabia.

Since becoming a member of the bank, the Guyana government has been aggressively pursuing projects that will increase Guyana’s infrastructure and optimise its productivity in the areas of agriculture, trade and competitiveness and human and rural development having committed to the diversification of Guyana’s economy in preparation for the first oil coming ashore in 2020.

With the support of Malaysia, Indonesia and Suriname through the Islamic Bank, Guyana wants to bring some modern technology and methods to improve its agriculture and tourism sectors. The country also wants to offer Islamic financial products.

Guyana is also getting support through grants from organs of the Organisation of Islamic Cooperation (OIC) and the Islamic Bank such as the Economic and Social Research and Training Centre for Islamic Countries (SESRIC) and Islamic Centre for the Development of Trade (ICDT), The Islamic Research and Training Institute (IRTI), the Standing Committee for Economic and Commercial Cooperation of the OIC (COMCEC) Project Funding (CPF) for six different cooperation areas – agriculture, finance, poverty alleviation, transport and communication, tourism and trade.

Guyana will attend the COMCEC meeting in Istanbul in November.

Guyana became a member of the IsDB in 2017 and the partnership was formalised with a mutual commitment to a five year work programme.